Binance's Connection with Hyperliquid: CZ Clarifies Speculation on Founder’s Past Project

Binance’s founder, Changpeng Zhao (CZ), has addressed ongoing rumors about Binance’s relationship with the new decentralized exchange, Hyperliquid. He confirmed that Hyperliquid's founder, Jeff Yan, previously participated in an early Binance incubation program that did not succeed. Despite this historical connection, CZ emphasized that Binance has no current investments or ties with Hyperliquid.

Key Takeaways

CZ clarified that Hyperliquid's founder was part of a previous failed project under Binance Labs.
Hyperliquid operates independently and has no financial stake from Binance.
The decentralized exchange is rapidly gaining market share against Binance.
Hyperliquid processed significant trading volumes, recently hitting an all-time high for perpetual futures.

Is Binance Backing Hyperliquid? CZ Breaks Silence, Reveals Founder’s Failed Binance-Backed Project

CZ Comments on Hyperliquid’s Founder’s Past

Changpeng Zhao, often referred to as CZ, recently addressed speculation regarding a potential connection between Binance and the emerging decentralized exchange called Hyperliquid. He confirmed that the platform’s founder, Jeff Yan, was part of a previous Binance Labs project but stated that there are no ongoing investment ties currently.

In a post shared on X, CZ explained that Jeff was part of the YZiLabs cohort in 2018, an initiative under Binance Labs. He noted, "Unfortunately, that project failed. YZiLabs did not recoup any of its investment. It happens."

CZ's Tweet about YZiLabs

This earlier venture focused on a decentralized prediction market known as Deaux, which ultimately did not succeed. CZ mentioned that he had limited interactions with Jeff at the time and only became aware of their connection earlier this year. He stressed that YZiLabs does not own any equity or tokens in Hyperliquid, underscoring Binance's commitment to supporting all builders in the blockchain space.

Clarifying Hyperliquid's Background

The debate surrounding Hyperliquid intensified after 2018 photos went viral, showing Jeff with other YZiLabs members. Jeff's initial project, Deaux, aimed to simplify decentralized prediction markets—a concept that later contributed to Hyperliquid's community-driven model.

Since launching its own layer-1 blockchain, Hyperliquid has quickly become one of the most dynamic platforms for DeFi perpetual trading. In July 2025 alone, it recorded a staggering trading volume of approximately $319 billion, the highest since its inception. This surge was part of a larger total volume for DeFi perpetuals, which reached an all-time high of $487 billion that month.

Hyperliquid’s architecture consists of two interconnected components: HyperCore, which manages order books and liquidations, and HyperEVM, a smart-contract layer that operates in unison with the exchange core. This advanced setup enables extraordinarily fast trade execution, boasting a median latency of merely 0.2 seconds—making it competitive with centralized exchanges.

Unlike most decentralized exchanges that use an automated market maker model, Hyperliquid leverages on-chain order books and matching systems. This approach merges the benefits of transparency with the fast execution typically associated with centralized trading platforms.

Hyperliquid is comprised of a compact team of just 11 members. Founder Jeff Yan declared that the project has maintained its independence by being self-funded and avoiding venture capital investments. Their efficient responses to operational issues have drawn attention; for instance, a recent outage led to $1.99 million reimbursed to traders within a single day.

While CZ clarified that Binance does not hold any financial interest in Hyperliquid, his remarks shed light on the shared history between Binance Labs’ early initiatives and the builders who are now at the forefront of significant DeFi projects.

The Rise of Hyperliquid and its Market Impact

Hyperliquid has steadily carved into Binance's share of the crypto derivatives market. As of now, it accounts for 13.6% of Binance's trading volume, an increase from just 8% at the year's start. This shift signals a growing preference for decentralized perpetual futures platforms as viable alternatives to centralized exchanges.

The exchange has been driving significant trading volumes, surpassing $200 billion recently, thanks largely to cross-chain features that support various assets, including Bitcoin. Currently, it holds about 70% of the decentralized perpetuals market, according to data from DeFiLlama and Token Terminal.

Hyperliquid’s native token, HYPE, recently achieved an all-time high of $59.29, pushing its market capitalization closer to $16 billion.

The demand for decentralized perpetual exchanges (perp DEXs) is increasing rapidly, with combined trading volume across the sector reaching $1.22 trillion in September—an impressive 48% rise from August. Much of this activity has been fueled by Hyperliquid and Aster, a newly launched derivatives DEX connected to YZi Labs and Changpeng Zhao.

In summary, while Binance continues to hold a commanding lead in daily futures trading with $83 billion, the gap between centralized platforms and decentralized alternatives is narrowing. Analysts suggest that the consistent liquidity of Hyperliquid, combined with Aster's swift ascent, indicates a significant shift is underway in the derivatives trading landscape—a shift favoring decentralized, transparent, and non-custodial trading environments.